Standard deviation of the damage, Econometrics

Assignment Help:

In a year, weather can impose storm damage to a home. From year to year the damage is random. Let Y be the dollar value of damage in a given year. Assume that 95% of the year's Y=$1,000, and 5% of the years, Y=$15,000.

a. Calculate the mean and standard deviation of the damage in any year.

b. Consider an 'insurance pool' of 100 sufficiently dispersed homes, which implies the damage to dissimilar homes can be viewed as separately distributed as random variables. If ? is the average damage to those 100 homes in a year, (i) what is the expected value of the average damage? (ii) What is the probability that ? exceeds $2000?

 


Related Discussions:- Standard deviation of the damage

Microeconomic, what is indirect utility function?

what is indirect utility function?

Public economics, Explain the stages and various coordination mechanisms in...

Explain the stages and various coordination mechanisms involved in policy processes. Discuss various factors that influenced the agenda setting in policy processes

calculate real and nominal growth rate in gdp, 1. (a) Consider a perfectly...

1. (a) Consider a perfectly competitive industry that produces a total output of 190 units in the long run. Suppose there are n identical firms in the market. Each firm then produc

Multiple regression with three explanatory variables , For a multiple regre...

For a multiple regression with three explanatory variables the value of R 2 is 0.75. Indicate whether every of the following statements is true or false and give brief reasons fo

Explain the inflation rate, The following regression was estimated to expla...

The following regression was estimated to explain the inflation rate in the USA.  The data set contains annual observations from 1970 to 2010.       Inft  =  2500 +   50*Xt  +

SURVIVOR ISLAND.., DISCUSS THE CENTRAL ECONOMIC PROBLEM FACING THIS GROUP O...

DISCUSS THE CENTRAL ECONOMIC PROBLEM FACING THIS GROUP OF SURVIVORS

Assignment., why do we make use of regression analysis in our econometrics ...

why do we make use of regression analysis in our econometrics analysis

I need a help with my assignment, My econometrics assignment is due for mon...

My econometrics assignment is due for monday, August 18th. I''m running out of time and need a help to meet the deadline. I need answers for 4 problems from the basic econometrics.

Profit Electron, Calculate the incremental profit Electron Control would ea...

Calculate the incremental profit Electron Control would earn by customizing its instruments and marketing directly to end users.

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd